You won your Fantasy Football League! Here comes the Tax Man…
Just like every NFL team starts September in the hunt for the championship, the same is also true for all the Fantasy players whose main claim to fame is probably their ability to choose a clever team name.
We all have aspirations of winning our league(s) and the bragging rights that go with it. But what about those winnings? Are those winnings taxable?
You bet (sorry) they are. In fact, if you win more than $600, you might get a 1099-MISC in the mail next January.
The winnings are reported as income, but you are allowed to deduct your related expenses incurred in generating that income. These expenses could include your losses from other Fantasy play, for example.
There are a couple different ways you could report the income and related expenses, but in any event, you cannot take any expenses greater than the income. You are not allowed to generate a taxable loss from these activities.
The important thing to remember here is to track your expenses from all these activities and keep documentation of those expenses. Without the records, you will lose again.
As always, consult with an Anders tax advisor with any questions you have.